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Enterprise Products Partners L.P. Message Board

harehau 307 posts  |  Last Activity: May 22, 2015 1:33 PM Member since: Oct 10, 2006
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  • Reply to

    oil rigs

    by harehau May 22, 2015 1:28 PM
    harehau harehau May 22, 2015 1:33 PM Flag

    Yellen, half listening. Says she can't predict and then begins to tell us what will happen, did say the "normal" funds rate probably takes several years to reach. Not sure what normal is and several years is not too precise. I'm not sure they should be so afraid of deflation. Seems there policies have put us back into a housing mini bubble. Seems we don't get inflation in consumable things and inflation in assets. Not sure how that plays out.

  • harehau by harehau May 22, 2015 1:28 PM Flag

    Down one to 659, looks like they have bottomed. I suspect they won't start to rise again for most of this year. And if that is correct, seems it would set up a decline in volumes into next year.

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 9:02 PM Flag

    A Cowen analyst mentioned M and A candidates, below is the comment on BCEI, seems at the current price, it's a takeout candidate. The stock performance is not explainable, maybe if you want pure exposure to the Niobrara, PDCE is the obvious target.

    Also holding attractiveness to potential buyers: Bonanza Creek Energy Inc (NYSE: BCEI).
    Bonanza "doesn't offer exposure to emerging basins," Robertson said. But its debt level and poor recent stock performance make a secondary offering problematic.

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 6:40 PM Flag

    Last comment, thought about the ROSE deal. I think the Niobrara is as good as the Permian or the EF, with IRRs at 50% at $60 oil. ROSE sold for $37k per acre for EF and Permian, 106k acres. If you figure BCEI's mid cont asset is worth $400 mm, the value of the Niobrara asset is worth $44 per share. Not sure why they don't sell the mid cont, seems that would move the stock and seems it would be an easy asset to sell. The price???

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 6:11 PM Flag

    Have been looking at BCEI, they show a 354mboe eur and PDCE has 375 avg for the middle core and outer. Looked at NBL and BCEI is well positioned to Wells Ranch and East Pony where most of NBL's acitivity is. Still feels that PDCE has better assets, maybe further long the curve and BCEI is a better relative value. If you look at CS $35/$22, 60% upside vs PDCE 40%. Probably both good bets but BCEI feels like a better buy. Going to watch, if it drops under $20, will probably buy some. Seems what we are seeing is a pause in recovery, Einhorn and Goldman didn't help. Don't see Goldman's call with 660 rigs running. BCEI will probably underspend capex by 10% or more. Seems they are playing it conservatively. Not sure I would be spending a bunch in the current price scenario. Still think $75 next year end and $80 to $90 in 17 is reasonable if rigs stay below 700.

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 3:51 PM Flag

    Need to look further at BCEI but looks like PDCE is getting higher EURs. PDCE seems to be pulling away from BCEI. They show 440mb EUR for mid core vs 354 for BCEI although the extended laterals show about the same. They have 2000 locations vs 2600 for PDCE. CS has $35 target on BCEI, can't find a report though and PDCE has a $80 target. Need to spend more time with the data but seems PDCE is ahead of the curve, may be a matter of better core.

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 3:22 PM Flag

    I went through the PDCD pres and q report. Impressive, they have a better asset than BCEI, 96k vs 70k acres, probably more core. They have close to 2600 locations, about half are in the middle core and they say they have IRRs of 50% at $60, $3.25 prices. The core is 76%, would suspect they are drilling more of the core this year. Bringing costs down, with perf changes ad fracture technology. Debt is better than BCEI. And then they have the Utica asset, 66k acres that they are sitting on at the moment. Spending $450mm this year. Going to look at BCEI again, but would say the PDCE has the edge in asset quality. PDCE still looks cheap. And the Niobrara/Codell is a top tier play. The wells they are drilling this year are returning 40 to 76% at $60/$3.25.

  • Reply to

    Hare

    by chumpbuttsmeller May 19, 2015 11:14 AM
    harehau harehau May 19, 2015 12:55 PM Flag

    chump, I need to circle back and look at the value vs PDCE. I always thought PDCE was the better value but this differential seems way too wide. PDCE seems to be more aggressive with technology.

  • Reply to

    Glad they are getting more NG assets.

    by jrfillion May 19, 2015 9:36 AM
    harehau harehau May 19, 2015 10:44 AM Flag

    This may be the worst management I've ever seen. Just glad I was cashed out of ATLS with the Targa deal. Only thing that will bail out this co is $4+ gas and $80+ oil. If GS is right, could be $60 and $3 for years, and this co does nothing, probably low single digits, produces reserves like a royalty trust. I don't think any of the e and p MLPs do well, a flawed form, where you could buy reserves that were profitable at $4 gas, $90 oil from others that had reserves profitable at $2 gas and $60 oil.

  • Reply to

    Cohen unloading ATLS assets to ARP Unitholders

    by jim_hairball May 18, 2015 5:07 PM
    harehau harehau May 18, 2015 8:08 PM Flag

    Wonder if the hedges are included in the sale, sounds like not. This guy is like the Wizard of Oz. Problem is their is not much left to create a smokescreen.

  • Reply to

    Cohen unloading ATLS assets to ARP Unitholders

    by jim_hairball May 18, 2015 5:07 PM
    harehau harehau May 18, 2015 6:13 PM Flag

    Probably ok for ARP holders, they probably bought it for a lot more. Lots of motion and no value created. Cohen was probably a magician in his last life. Rearranging deck chairs on the Titantic comes to mind

  • Reply to

    Cohen unloading ATLS assets to ARP Unitholders

    by jim_hairball May 18, 2015 5:07 PM
    harehau harehau May 18, 2015 5:42 PM Flag

    How long will people put up with this #$%$. What did they pay for the asset? Bet it was a bunch more than $36mm.

  • Reply to

    ARP Q1 2015 variance report

    by marydelapoer May 16, 2015 5:30 PM
    harehau harehau May 18, 2015 5:08 PM Flag

    I tend to agree with you, my guess, $75 end of next year and $80 to $90 the next. 700 rigs can't supply the globe with 6mm bs needed each year. OAS said that their prod would decline 25% this year without drilling. But who knows what technology will do, we already have the prospect of refracking, cheap reserves in already drilled wells. And increasing recovery from 5 to 10% doubles reserves. At the moment, I don't think oil follows nat gas' trend because of the ease of exporting. It does seem that the amplitude of the curve will be less, cos are already talking start up of rigs at $65, not like the case where deep water takes 7 years to bring on. Probably means prices will not spike as high or fall as low, could gyrate from $80 to $100, instead of $40 to $140. Would guess we are talking peak oil again in 10 years. But you never know, it's what keeps it interesting.

  • Reply to

    pdce

    by harehau Apr 10, 2015 9:32 AM
    harehau harehau May 18, 2015 3:19 PM Flag

    GS target of high $70s at the same time they were downgrading the price of oil to $50s in few years. PDCE has great position in top tier rocks, good balance sheet.

  • Reply to

    ARP Q1 2015 variance report

    by marydelapoer May 16, 2015 5:30 PM
    harehau harehau May 18, 2015 3:17 PM Flag

    I don't trust Goldman but the market reacts to what they say, they have been wrong so far on oil and think they are still off base. But that means nothing longer term, they could be right. If we supply the world with oil at $60 for years to come, buy all of the top tier midstream/infrastructure companies and forget about the second tier e and p cos. Seem GS is saying the oil shales will replicate the nat gas experience, volumes keep growing at lower prices. We still haven't seen the end of the nat gas volume growth. Bottom line for me is ARP is not a good bet as well as any company that's not exposed to the best rocks and has a good balance sheet, neither of which applies to ARP, and not to mention crummy management. Not a good equation.

  • Reply to

    ARP Q1 2015 variance report

    by marydelapoer May 16, 2015 5:30 PM
    harehau harehau May 18, 2015 12:29 PM Flag

    Nat gas futures for 20 are in $3.60s and WTI at $69. Those prices still aren't good enough for ARP to do well. But $69 is better than GS's call of $55. Better have a good rationale for a contrarian bet other than prices were $100 before and hedges protect for a while. Seems the Saudis are bent on squashing the US shale boom at any price. I missed that in the fall but does appear to be reality. Seems the safer play is buying a Permian producer that is profitable at $60 oil and a Marcellus co that can make money at $2.

  • Reply to

    oil price

    by harehau May 16, 2015 10:24 AM
    harehau harehau May 18, 2015 11:32 AM Flag

    Can't argue with your scenario. The oil scenario could turn out to be like nat gas, price stays low and the midstream cos continue to do well as volumes increase. If I was going to buy an e and p today, it would be the Permian, maybe OX'y... But again, feels like the stocks, oil price are maybe ahead of the recovery at the moment. A ME blowup would change everything over night or more global demand, positive China data. Today's guess, oil at $75 end of 16 and $80 to $90 in 17. I don't think the shales can supply the world longer term but if they do, my infrastructure cos will explode and I won't care about where oil settles long term. I don't trust GS but they do get it right some times.

  • Reply to

    ARP Q1 2015 variance report

    by marydelapoer May 16, 2015 5:30 PM
    harehau harehau May 18, 2015 11:22 AM Flag

    Without the hedges, would anyone invest in ARP at $60 oil and $3 gas. In that scenario, you just produce the reserves with no drilling. Their reserves are non economic at that price deck. Only the top tier shales will be viable. Whether there are enough reserves there to supply the globe is the issue, and GS believes it happens. I'm not there but it is a possibility. In that scenario, only the top tier cos will survive. You have to have a very bullish call on gas and oil to stay with ARP. See it time and again, a high div/dist keeps investors in a name until it falls off the cliff.

  • Reply to

    I dont get it

    by chumpbuttsmeller May 18, 2015 10:37 AM
    harehau harehau May 18, 2015 11:07 AM Flag

    chump, GS is definitely affecting the market, imo. And you are right, they have been wrong on their $30 call so far. They are claiming that the shales can supply the market at $60, $55 in 2020. Seems the supply will come from the ME at $40, shales at $60 minimum and $90 deep water and oil sands. Question in my mind is how the shales can supply the world at $60. Another poster who did a fairly detailed analysis came up with 8.3mmb/d mid 16, that's down a million barrels at the current rig count. There are some that think cost coming down and new efficiencies will bring down the supply cost. I agree with you that the marginal barrel will come from the $90 cost reserves, deep water and oil sands. And demand is as important, and it seems to be coming back. Still seems mid next year will show a significant decrease in volumes, down a million barrels in the shales in 700 rig scenario and $60 price. Price is going to have to respond assuming good global demand. Too many investors talking their book, GS and Einhorn, but the talk won't change the supply demand equation. Seems BCEI continues to be cheap. But if GS is right and the US shales supply the world at $60, the infrastructure cos will do really well if we are the OPEC of the future. Interesting times. A guess today, $75 next year end and $80 to $90 in 17. That guess and $2 will buy you a cup of Starbucks. Today feels like GS if trying to trade the market and they are good at it but it doesn't have much to do with long term prices.

  • Reply to

    ARP Q1 2015 variance report

    by marydelapoer May 16, 2015 5:30 PM
    harehau harehau May 18, 2015 9:39 AM Flag

    Goldman sees oil at $55 oil in 20. At $3 gas and $60 oil for the next several years, easy answer. Enjoy the dist while you can. The whole e and p MLP form will be history.

EPD
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